What Is a Payroll Schedule and How Do Employers Choose One?

It’s not enough to pay employees. When you pay them may be just as important.

The ideal payroll schedule — or the pace at which you process payroll — can depend on:

• your industry
• the people you employ
• a standard set by your competition
• local, state or federal laws that regulate pay
• and more

Which payroll schedule works best isn’t always obvious. In fact, even a longstanding method might not work best for your current (or future) workforce. And even if you know you should adjust your payroll schedule, maybe you don’t believe you have the resources needed to sustain it.

No need to mark your calendar for these answers. We’ll find them right now! Let’s explore how payroll schedules work, their common forms and everything you need to consider before pursuing the right option.

What is a payroll schedule?

A payroll schedule is a recurring structure that specifies when employees get paid. While most payroll schedules don’t depend on fixed dates, approaches like a semimonthly schedule do. Certain industries — including education and season-dependent sectors — may even pause or alter their pay schedules depending on the time of year.

Most organizations will use one of these four payroll schedules:

• weekly
• biweekly
• semimonthly
• monthly

As of 2023, the U.S. Bureau of Labor Statistics found 43% of businesses rely on biweekly payroll schedules. Monthly represents the least commonly used structure at just 10.3%. This data also reveals that larger organizations are less likely to use a biweekly payroll schedule.

Common payroll schedules

With the most common payroll schedules in mind, let’s examine how they specifically work and why a company might choose one over the other.

Remember, it’s possible a local or state law may regulate the rate you can pay employees up to a certain point. Consult a licensed legal professional to ensure your payroll processes operate in compliance.

Weekly

Under weekly payroll schedules, employers pay their people on the same day each week. This results in an average total of 52 pay periods each year. (This may change during leap years.)

Generally, most businesses pay their teams on Fridays. However, those with weekly payroll schedules could theoretically pay employees on any day of the week.

Pros and cons of weekly payroll schedules

Weekly payroll schedules have their upsides, but those come with certain drawbacks, too.

For example, employees may work more productively knowing they’ll receive a paycheck each week. Plus, greater access to their funds could make them happier and create a better opportunity for them to effectively plan their financial obligations.

On the other hand, a weekly payroll schedule may place a heavier administrative burden on HR without the right tools. A weekly schedule may also come off as too overwhelming for businesses like a small startup company that can’t sustain such frequent payments.

When should companies use a weekly payroll schedule?

Industries with irregular hourly shifts may find weekly payroll schedules ideal for engaging employees. These businesses include:

• food service
• hospitality
• retail
• construction
• and more

If you notice employee satisfaction declining, a weekly payroll schedule could help you turn the tide. After all, in periods of economic uncertainty, workers may appreciate the more frequent income, even if it doesn’t technically increase their wages overall.

Biweekly

On a biweekly payroll schedule, employees receive their pay every other week. This accounts for two weeks’ worth of work. Biweekly payroll schedules also create approximately 26 pay periods per year.

Again, this approach is by far the most common among businesses in the private sector. Like weekly schedules, Friday tends to be the most common payday. However, employers could still pay their people on a different day, should they feel it necessary.

Pros and cons of biweekly payroll schedules

Biweekly payroll schedules are the most popular for a reason. For instance, they can produce fewer administrative costs for companies while still paying employees with relative frequency. While not as rapid as its weekly counterparts, it still grants people consistent income with enough flexibility for them to plan.

That said, this may not be ideal for every employee, depending on their financial obligations. And without automated tech that self-starts payroll, HR may encounter more errors since certain months will have three pay periods on a biweekly schedule.

When should companies use a biweekly payroll schedule?

Biweekly payroll schedules are used across many different businesses. Industries that frequently use this approach include:

• manufacturing
• technology
• automotive
• leisure and hospitality
• education
• and more

If your business needs to strike a balance between administrative costs and satisfying employees, a biweekly payroll schedule may allow you to accomplish both.

Semimonthly

Semimonthly payroll schedules create consistent pay periods on the 15th and last days of each month. This structure may seem like a biweekly payroll schedule — and it is! However, a company using semimonthly schedules will only have 24 pay periods each year. And this won’t change, even during leap years.

Pros and cons of semimonthly payroll schedules

Though technically not as frequent as its biweekly counterpart, a semimonthly schedule creates more predictability that could ease an administrative burden. These fixed periods could also help employees budget, too.

At the same time, semimonthly payroll schedules could be frustrating for employees. That’s because semimonthly pay periods rarely fall on a consistent day of the week. Plus, longer months like October and December could force employees to wait longer before receiving their pay.

When should companies use a semimonthly payroll schedule?

Ultimately, the decision to use a semimonthly payroll schedule should be based on administrative need and employee expectations. The same industries that use biweekly schedules may find semimonthly more appealing. However, that ultimately depends on the needs of your unique workforce.

If your team struggles to keep up with a biweekly schedule, a semimonthly approach may be your best bet. However, make sure employees understand the implication of this structure, and consider their needs before deploying it because it seems easier.

Monthly

Monthly payroll schedules result in employees getting paid once per month, typically on the first or last day. This produces 12 pay periods each year. Though certain businesses may opt to pay employees quarterly, monthly payroll schedules yield the longest breaks between pay periods among the most common structures.

Pros and cons of monthly payroll schedules

The benefits of monthly payroll schedules tend to serve employers. For example, infrequent pay periods relieve HR of an otherwise frequent and sometimes cumbersome administrative task. Smaller businesses may also find monthly pay periods align better with their revenue as it relates to payroll.

Of course, reduced administrative burden could require employees to face a higher financial burden. Infrequent pay periods mean certain workers will need to be more deliberate with their financial planning. And in the case of emergencies, waiting roughly four weeks between pay periods could prove difficult.

When should companies use a monthly payroll schedule?

As the least used common payroll schedule, a monthly approach tends to benefit smaller organizations or those with mostly salaried staff. Companies with no or an otherwise extremely small HR team might find a monthly schedule useful to ease their administrative lift. However, even these companies should consider the needs of their employees and verify a monthly payroll schedule lies in their best interest.

5 factors to consider before choosing a payroll schedule

Even seemingly identical businesses may have vastly different payroll schedules. Employees’ needs, revenue and other logistics all play a part in influencing an organization’s ideal approach. Additionally, a specific state or local law could limit the schedule a business can implement.

Let’s run through five of the most important variables you should keep in mind before committing to a specific payroll schedule.

1. Employment classification

Payroll schedules exist to create consistency for employees, so it makes sense to place them at the forefront of any consideration. For example, hourly and part-time staff may appreciate a weekly payroll schedule, since they may prefer to receive their compensation sooner due to inconsistent shifts.

Conversely, full-time employees may accept a biweekly or semimonthly schedule because their more consistent and possibly fixed schedules translate to more consistent paychecks.

Think about the composition of your workforce and identify what would be in their best interest. At the same time, you should ensure your payroll processing team can manage whichever schedule you land on.

2. Business cash flow

A company can only pay employees what it can afford. Ensure that your payroll schedule allows you to consistently and reliably pay workers based on your cash flow. Certain businesses may find a semimonthly schedule better aligns with their revenue due to its preset dates. High-volume organizations, on the other hand, may have the capacity to maintain a weekly cadence.

While you should always consider employees’ needs, never adjust your payroll schedule to the point where your organization can’t afford it. It may seem obvious, but doing so would detrimentally impact your people, too.

3. Administrative burden

Payroll should be 100% accurate with no exception. Failing to uphold payroll breaks perhaps the most vital promise an employer makes to its workforce.

That said, companies should ensure their HR staff and resources can sustain the payroll schedule they use. An extremely small startup, for instance, may have little choice but to implement a monthly schedule if their lone HR officer doesn’t have access to automated payroll tech. However, a large enterprise could have the bandwidth to experiment with different payroll schedules and possibly give employees a greater say in how they get paid.

Ultimately, your ideal payroll schedule needs to fall within the capability of who’s processing it. Otherwise, your organization could struggle with a wave of trust-breaking and turnover-inducing mistakes.

4. Employee preferences

If you can choose your payroll schedule, turn the decision over to employees! Conduct surveys and gather feedback to determine what payroll schedule works best for them. Depending on your workforce’s makeup, you may find it beneficial to try out multiple approaches. Don’t shy away from trying something if you identify demand.

5. Payroll provider

Regardless of the payroll schedule you deploy, you should ensure your HR software can sustain it. You should also consider cost-effective options since providers’ fees tend to fluctuate depending on their pricing model. Common pricing structures include:

• flat rate per employee
• head count discounts
• pay per feature, per user
• long-term contacts vs. monthly
• per-payroll processed

Above all else, look for a payroll partner that simplifies HR’s work by automating administrative tasks. Consider tech that self-starts payroll each period, automatically flags errors and guides employees to find and fix those mistakes before submission.

Read our payroll provider buying guide for more insight into finding the right tech.

Payroll schedules: FAQ

How many pay periods are there in 2024?

The exact number of pay periods depends on the payroll schedule a company uses. Weekly schedules will produce 52 pay periods, though employers who pay their people on Monday or Tuesday will have 53. Those with biweekly schedules will have 26 pay periods. Businesses on a semimonthly pay schedule will have their typical 24 pay periods. Finally, organizations that pay employees monthly will do so 12 times in 2024.

How many pay periods are there in a month?

It depends on the payroll schedule a company uses. Those who use a monthly structure will only pay employees once per month. Weekly payroll schedules typically produce four pay periods each month, and semimonthly results in two paydays over the same range. Biweekly pay periods usually result in two paydays a month, though at least two months (May and November in 2024) will have three.

Can you change pay periods?

Yes, but businesses should communicate this change to employees so they have ample time to prepare and understand how it may affect them.

Is it legally required to create a payroll schedule?

Not federally. However, most states maintain rules (known as “pay frequency laws”) that mandate a minimum frequency for paying employees. Always consult a licensed legal professional before assuming your payroll schedule complies.

Explore Paycom’s resources to learn about payroll processing, compliance and more.